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Dominique de Kevelioc de Bailleul: “The incredible gold scandal,” the German newspaper BILD began its article about the disposition of Germany’s mysterious gold holdings following the collapse of Lehman Brothers in 2009.

Growing pressure from the German people and politicians exerted upon its  central bankalt, the Bundesbank, to audit the nation’s gold reserves intensifies, running parallel with escalating anxieties felt by German taxpayers for more than two years leading up to Greece’s to-big-to-pay $18 billion interest payment deadline of March 20, 2012.

Considering the ominous Greek sovereign debt backdrop, a suspicious Germany now wants to know where its gold is stored, as the last audit made in 2007 clearly indicates that the Bundesbank skipped its 2010 audit.

Just as pressure has been applied on the Fed by U.S .Rep. Ron Paul to agree  to an audit of U.S. Treasury gold held at Ft. Knox and West Point, Germany may  have to break the rules, too, by stonewalling the country’s elected  representatives on the matter of its gold reserves.

“A clear breach of the law,” top Bilanzrechtler Prof. Jörg Baetge told BILD. “At least every three years to control counts the bars are made. [Google translation]”

When Germany’s controversial member of the Bundestag, Phillip Missfelder,  inquired into the reason for the missed audit by the Bundesbank, the  32-year-old  chairman of the Junge Union received a series of Fed-like  responses from Germany’s central bank.

“I was shocked,” Missfelder told BILD.  “First they said that there was  no list.  Then there were lists that are secret.  Then I was told,  demands endanger the trust between alliance bank and the Fed. [Google translation]”

A skipped audit, and now, peculiar responses from one of the most respected  central banks, regarding the world’s second-largest sovereign gold stockpile (after the United Statesalt) has gold bugs wondering if German gold has been essentially held hostage at the NY Fed to prevent another explosive run in the gold price.

Coincidentally, or not, some traders suspect that Venezuela’s Hugo Chavez’s repatriation of 99 tons of gold from London vaults created a nearly 25 percent  jump in price during the un-seasonal summer rally in gold of last year.

But in the case of Germany’s (NYSEarca:EWG) 3,401 tons, of which approximately 60 percent  (2,000 tons) is rumored to be stored outside of Frankfurt, a potential move in  the gold  pricefrom an unwind of 20 times more potentially re-hypothicated gold  (levered as much as 100:1) could take out gold $5,000, $10,000, $20,000 or more,  easily, if Germany insisted that its gold (possibly rehypothicated) be returned  to its own vaults.

A leveraged gold market of approximately 100:1 would, in effect, translate to 200,000 tons (2,000 x 100) removed from the gold market (or any fraction of that  amount).  That cannot happen without a total and immediate implosion of the  world’s Western fiat currencies (in terms of gold).  It’s too much gold to  unwind and continue on the facade of viable Western fiat currencies.

Therefore, German gold moving back to Germany won’t happen.  London’s scramble to find 99 tons for Chavez is one thing; finding as much as 2,000 tons  to ship to Frankfurt is quite another.

Missfelder told BILD, “It may be that is the gold assets of the German  apparently violate any applicable accounting law.  This is a case for  Parliament.  I call for a clear view. [Google translation]”

Aside from the heat that Germany has taken for more than two years in its  fight against pledging its country’s people as collateral for Greek fiscal  profligacy, Germany has another, even bigger problem.  That is: how to  repatriate German gold without destroying all hope of keeping the post-Bretton  Woods fantasy alive.

Will Germany ultimately take the big hit at the endgame of dollar hegemony?

Author of Currency Wars, Jim Rickards, believes that German gold has, de facto, been confiscated, already.  If any mention from the officialdom in Berlin that it seeks to repatriate its gold reserves could force  Washington’s hand to refuse the request and confiscate the up-to 2,000 tons of  gold held at the NY Fed.

“ . . . as I’ve described in the book Currency Wars, if the U.S.  gets into extreme distress, and there’s a collapse in the dollar, I have no  doubt that in an emergency basis the U.S. will basically confiscate all the gold in their possession,” Rickards told King World News in mid-November.  “Then  they will convert it to back up a new gold based U.S. dollar as plan B or some way to stop the crisis.”

Rickards continued, “So it’s a political question for Germany as to whether  they want their gold back, but sometimes you don’t ask questions if you don’t think you are going to like the answer.  It would be interesting if Germany demanded that gold be shipped to Frankfurt or Berlin what the U.S. would  say.”

Bron